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February 21, a 20% Foreign Buyer Tax will be levied on purchases in the Capital Region - according to the BCREA this tax will have an immediate impact on transactions underway, but there are some transitional rules, outlined below.
Transitional Rules
If the property is located in the Capital Regional District, Fraser Valley Regional District, Regional District of Central Okanagan or Nanaimo Regional District and the property transfer is registered on or after February 21, 2018, there are two instances where you don't have to pay the additional property transfer tax:
1. You don't have to pay the additional property transfer tax if the registration occurs before or on May 18, 2018 and the property transfer is subject to a written agreement dated on or before February 20, 2018. Otherwise you will have to pay the additional property transfer tax.
Note: If the written agreement is assigned to a foreign entity or taxable trustee on or after February 21, 2018, the additional property transfer tax must be paid.
2. You don't have to pay the additional property transfer tax and your property can be registered at any time if:
The property transfer is subject to a court order dated on or before February 20, 2018
The property transfer is subject to an Order Nisi of Foreclosure dated on or before February 20, 2018
The property transfer is subject to a separation agreement which was signed on or before February 20, 2018
The property transfer is from the personal representative of a deceased's estate to the beneficiary and the death of the deceased occurred on or before February 20, 2018
The property transfer is to a surviving joint tenant when the death of the deceased occurred on or before February 20, 2018
Also live tomorrow is an increased Property Transfer Tax for properties over $3 million. The Property Transfer Tax will increase to 5 per cent for properties over $3 million.
The Minister of Finance also announced that a speculation tax will roll out in Fall 2018.
The Housing Market in Victoria has continued to be extremely hot with both Sellers and Buyers reaping the rewards. The current inventory is lower than average and coupled with low interest rates, the current housing market will continue to remain hot.
If you are planning to sell or buy within the next three months, give me a call and I will ensure you realize the best possible result.
Vancouver, BC – November 28, 2017. The British Columbia Real Estate Association (BCREA) released its 2017 Fourth Quarter Housing Forecast today.
Multiple Listing Service® (MLS®) residential sales in the province are forecast to decline 10.4 per cent to 91,700 units in 2018, after an expected 8.8 per cent decrease this year. A record 112,209 unit sales were recorded in 2016. The ten-year average for MLS® residential sales in BC is 84,700 units. Strong economic and demographic fundamentals are supporting elevated housing demand. However, a number of factors are expected to temper home sales in the province next year.
“Housing demand across the province will face increasing headwinds in 2018," said Cameron Muir, BCREA Chief Economist."A rising interest rate environment combined with more stringent mortgage stress tests will reduce household purchasing power and erode housing affordability." The 5-year qualifying rate is forecast to rise 20 basis points to 5.15 per cent by Q4 2018, and the new qualification rules for conventional mortgages will erode purchasing power by up to 20 per cent. "Given the rapid rise in home prices over the past few years, the effect of these factors will likely be magnified."
The supply of homes for sale is now trending at or near decade lows in most BC regions. The imbalance between supply and demand has been largely responsible for rapidly rising home prices. The combination of weakening consumer demand and a surge in new home completions next year is expected to induce more balanced market conditions, producing less upward pressure on home prices. The average MLS® residential price in the province is forecast to increase 3.1 per cent to $712,300 this year, and a further 4.6 per cent to $745,300 in 2018.
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If you are a Seller and looking to discuss the market value for your property, send me an email or call me at 250.884.3980 and we can sort.
If you are a Buyer looking at the upcoming changes, as of January 1, 2018 with the mortgage stress testing and the resulting implication on affordability, call me and we can discuss.
BC Government Limits Choices for Real Estate Consumers
Vancouver, BC – September 7, 2017. The BC Government's announcement to ban the practice of limited dual agency means that consumers can no longer choose the REALTORS® they want.
"Every day, REALTORS® help their clients understand real estate transactions, so they can make informed decisions," said BC Real Estate Association (BCREA) President Jim Stewart."Over my nearly 25-year career as a REALTOR®, many long-standing clients have developed trust with me, and now my clients have no choice but to start from the beginning and build new relationships. Trust is a crucial part of what is often the largest financial transaction in people's lives."
Limited dual agency occurs when a real estate trading services licensee acts in a limited capacity for both the buyer and the seller. The practice is especially common and important in small BC communities, in which few licensees practice, and so BCREA is pleased to see a proposed exemption for those situations. However, limited dual agency is also used in cases where REALTORS® have established relationships with buyers and sellers, in commercial transactions and in situations where REALTORS® specialize in particular property types.
"Rather than working with licensees they don't know, we're concerned people may decide to complete real estate transactions without representation," said BCREA CEO Robert Laing."That goes against the consumer protection mandate of the Superintendent of Real Estate and the Real Estate Council of BC."
At the end of June 2016, the Independent Advisory Group (IAG) made 28 recommendations aimed at improving the real estate licensing system and the protection of consumers. For more than a year, BCREA has urged the BC Government, Superintendent of Real Estate and Real Estate Council of BC to carefully examine the IAG recommendation to eliminate limited dual agency. The vast majority of BC's more than 22,000 licensees are diligent, ethical and trustworthy, and so BCREA has recommended that limited dual agency should be allowed through the express consent of consumers.
"We know consumers value the right to choose their own representatives," said Mr. Laing. "Over the next few days, BCREA will examine the draft rule changes carefully and consult with the 11 real estate boards to determine our next steps."
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Quick facts:
In response to a July 2017 survey:
67% of BC real estate consumers said it's very important or somewhat important that they be able to work with the REALTOR® of their choice,
More than four-in-five BC homeowners (84%) used the services of a REALTOR® for their last property transaction.
88% of BC homeowners who worked with a REALTOR® say they are very or somewhat satisfied with their services.
BCREA is the professional association for over 22,000 REALTORS® in BC, focusing on provincial issues that impact real estate. Working with the province's real estate boards, BCREA provides continuing professional education, advocacy, economic research and standard forms to help REALTORS® provide value for their clients.
To demonstrate the profession's commitment to improving Quality of Lifein BC communities, BCREA supports policies that help ensure economic vitality, provide housing opportunities, preserve the environment, protect property owners and build better communities with good schools and safe neighbourhoods.
Canadian housing starts increased 1 per cent in August to 223,232 units at a seasonally adjusted annual rate (SAAR). The six-month trend in Canadian housing starts was also higher at 219,447 units SAAR.
New home construction in BC fell 21 per cent on a monthly basis to a still robust 35,773 units SAAR but were up 4 per cent on a year-over-year basis. Single detached starts fell 7 per cent month-over-month and were 3 per cent lower year-over-year. Multiple unit starts declined 26 per cent on a monthly basis but were up 7 per cent year-over-year.
Looking at census metropolitan areas (CMA) in BC:
Total starts in the Vancouver CMA fell 13 per cent year-over-year in August. Both single and multiple unit starts declined, falling by 2 and 16 per cent respectively on a year-over-year basis.
In the Victoria CMA market, housing starts followed up a surge in new units in July with a further 22 per cent year-over-year increase in August. Multiple unit starts were once again the main source of growth, rising 46 per cent year-over-year.
New home construction in the Kelowna CMA more than doubled compared to August 2016 due to a number of multiple unit projects breaking ground. Many of those units are new rental units, which year to date have totaled 1,366 starts. That is the highest 8 month total for construction of rental units in Kelowna's history.
Housing starts in the Abbotsford-Mission CMA continued a torrid pace of growth in August, rising 93 per cent year-over-year, boosted by strong growth in both single and multiple unit starts.
September 6, 2017 - Bank of Canada Interest Rate Announcement
Overnight Leading Rate
The Bank of Canada announced this morning that it is raising its target for the overnight rate by 25 basis points to 1 per cent. In the press release accompanying the decision, the Bank noted that recent economic data have been stronger than expected but growth is forecast to moderate in the second half of the year. On inflation, the Bank cited some excess capacity and temporary price shocks as factors keeping inflation below its 2 per cent target.Importantly, the Bank mentioned it will be paying particular attention to the evolution of the economy's potential growth rate (meaning the economy's estimated long-run growth rate) as well as to labour market conditions and the economy's sensitivity to higher interest rates.
The Bank has now removed the stimulus it injected into the Canadian economy in 2015 to offset the impact of falling oil prices. With the economy expanding at a 3.5 per cent rate over the past year, that stimulus is clearly no longer required. The Bank seems to be more concerned about the potential for higher future inflation due to an over-heated economy than on the actual very low inflation observed in recent months. That leaves the door open for further rate increases should economic growth remain robust.
How to Benefit from the Hot Property Market
The Housing Market in Victoria has been extremely hot for the past eighteen months with both Sellers and Buyers reaping the rewards. The current inventory is lower than average and coupled with low interest rates, the current housing market will continue to remain hot.
If you are planning to sell or buy within the next three months, give me a call and I will ensure you realize the best result possible.
BC Government Limits Choices for Real Estate Consumers
Vancouver, BC – September 7, 2017. The BC Government's announcement to ban the practice of limited dual agency means that consumers can no longer choose the REALTORS® they want.
"Every day, REALTORS® help their clients understand real estate transactions, so they can make informed decisions," said BC Real Estate Association (BCREA) President Jim Stewart."Over my nearly 25-year career as a REALTOR®, many long-standing clients have developed trust with me, and now my clients have no choice but to start from the beginning and build new relationships. Trust is a crucial part of what is often the largest financial transaction in people's lives."
Limited dual agency occurs when a real estate trading services licensee acts in a limited capacity for both the buyer and the seller. The practice is especially common and important in small BC communities, in which few licensees practice, and so BCREA is pleased to see a proposed exemption for those situations. However, limited dual agency is also used in cases where REALTORS® have established relationships with buyers and sellers, in commercial transactions and in situations where REALTORS® specialize in particular property types.
"Rather than working with licensees they don't know, we're concerned people may decide to complete real estate transactions without representation," said BCREA CEO Robert Laing."That goes against the consumer protection mandate of the Superintendent of Real Estate and the Real Estate Council of BC."
At the end of June 2016, the Independent Advisory Group (IAG) made 28 recommendations aimed at improving the real estate licensing system and the protection of consumers. For more than a year, BCREA has urged the BC Government, Superintendent of Real Estate and Real Estate Council of BC to carefully examine the IAG recommendation to eliminate limited dual agency. The vast majority of BC's more than 22,000 licensees are diligent, ethical and trustworthy, and so BCREA has recommended that limited dual agency should be allowed through the express consent of consumers.
"We know consumers value the right to choose their own representatives," said Mr. Laing. "Over the next few days, BCREA will examine the draft rule changes carefully and consult with the 11 real estate boards to determine our next steps."
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Quick facts:
In response to a July 2017 survey:
67% of BC real estate consumers said it's very important or somewhat important that they be able to work with the REALTOR® of their choice,
More than four-in-five BC homeowners (84%) used the services of a REALTOR® for their last property transaction.
88% of BC homeowners who worked with a REALTOR® say they are very or somewhat satisfied with their services.
BCREA is the professional association for over 22,000 REALTORS® in BC, focusing on provincial issues that impact real estate. Working with the province's real estate boards, BCREA provides continuing professional education, advocacy, economic research and standard forms to help REALTORS® provide value for their clients.
To demonstrate the profession's commitment to improving Quality of Lifein BC communities, BCREA supports policies that help ensure economic vitality, provide housing opportunities, preserve the environment, protect property owners and build better communities with good schools and safe neighbourhoods.
Bank of Canada Interest Rate Decision - July 12, 2017
The Bank of Canada announced this morning that it is raising its target for the overnight rate by 25 basis points to 0.75 per cent. In the press release accompanying the decision, the Bank noted that Canada's economy has been robust and a significant amount of economic slack has been absorbed. While inflation data has been soft, the Bank expects that this is temporary and that inflation will return to its 2 per cent target by mid-2018.
The motivation for today's rate increase seems primarily to be that the Bank feels that the stimulus it injected into the Canadian economy in 2015 through two rate cuts is no longer required given a recent trend of strong economic and employment growth. If that is the case, a further 25 basis point increase before the end of the year will likely follow. After that, the pace of rate increases relies heavily on the trend in Canadian inflation, which to date has been well below the Bank's 2 per cent target. If that trend does not reverse by early next year, the Bank may decide to stop at a 1 per cent overnight rate until higher inflation emerges.
As bond markets reprice rate expectations, Canadian mortgage rates have returned to levels observed at the beginning of the year. We expect that mortgage rates will rise further in the second half of 2017, finishing near 3 per cent for a five-year fixed rate.
Canadian inflation, as measured by the Consumer Price Index (CPI), registered just 1.3 per cent in the 12 months to May. That is down from 1.6 per cent in April. The Bank of Canada's new core measure of inflation, called CPI-common, was also up 1.3 per cent for the fourth consecutive month. In BC, provincial consumer price inflation was 1.9 per cent in the 12 months to May.
Given the Bank of Canada's recent hawkish turn on monetary policy, the trend in inflation will be even more important in coming months. So far, there is little in the inflation numbers to justify an interest rate increase, though the very strong economic growth over the past year could put some upward pressure on prices soon.
The total value of Canadian building permits declined 0.2 per cent to 7.1billion in April, the third consecutive monthly decline. Lower construction intentions for single-family homes, primarily in the Toronto CMA, was a main contributor to April's decline.
Permit activity bounced back in BC following a large decline in March, led by strong construction intentions for multi-family dwellings. The total value of permits increased 22.9 per cent on a monthly basis and were essentially flat year-over-year. Residential permits rose 19 per cent on both a monthly basis but were 7.4 per cent lower year-over year whilenon-residential permits were up 34 per cent on a monthly basis and 24 per cent year-over-year.
Construction intentions were higher in three of BC's four census metropolitan areas (CMA). Permits in the Abbotsford-Mission CMA more than tripled on a monthly basis while the Victoria CMA saw permit values increase 25per cent on a monthly basis and 28 per cent year-over-year. In the Kelowna CMA, permits were 8.9 per cent lower on a monthly basis but were 50 per cent higher than permit values in April 2016. In the Vancouver CMA, permit activity bounce back from a decline in April, posting a 25 per cent monthly increase but were 18 per cent lower compared to April 2016.
The Canadian economy expanded 3.7 per cent in the first quarter of 2017, led by an acceleration in household consumption spending as well as a nearly 3 per cent rise in business investment. The latter is a particularly welcome sign for the economy given that business investment had declined in eight of the previous nine quarters. A build up of inventories, especially in the manufacturing sector was also a significant contributor to growth in the first quarter, but also signals a slowing in the second quarter as firms produce fewer goods and wind down that inventory.
Although the Canadian economy has grown much faster than the Bank's estimate of potential growth for three consecutive quarters, it is not expected that the economy will sustain that level of growth for much longer. We forecast that real GDP growth will fall back to an average of 1.5 per cent quarterly growth for the remainder of 2017. However, the strong start to the year means that annual growth for this year is likely to register close to 2.5 per cent, the strongest economic growth in three years. Despite faster growth, a significant amount of slack remains in the economy and there is therefore very little pressure on inflation. Without a signal that inflation is going to push higher, the Bank will remain sidelined at least until early 2018 when it expects remaining slack in the economy will be eliminated.
Bank of Canada Interest Rate Announcement - May 24, 2017
The Bank of Canada announced this morning that it is holding the target for its overnight rate at 0.5 per cent. In the press release accompanying the decision, the Bank noted that inflation is broadly in line with the Bank's projection, though intense retail competition is pushing inflation temporarily lower. The Bank also noted that the tightening of mortgage regulations implemented in the Fall of 2016 have yet to have a substantial cooling effect on markets but it does expect those measures will contribute to a more sustainable debt profile for Canadian households.
Although the Canadian economy has expanded well above the Bank's estimate of potential growth for three consecutive quarters, including a first quarter that is tracking at close to 4.5 per cent growth in real GDP, the Bank is not optimistic that the economy will sustain that level of growth for much longer. Moreover, despite faster growth, a significant amount of slack remains in the economy and there is therefore very little pressure on inflation. Without a signal that inflation is going to push higher, the Bank will remain sidelined at least until early 2018 when it expects remaining slack in the economy will be eliminated.
Too often this column focuses on a REALTOR®'s error or mistake resulting in the REALTOR®'s censure by either a court or the Real Estate Council of British Columbia. Such columns, while concentrating on the negative aspects of practice, are essential in providing REALTORS® with an understanding of the appropriate standard of care and duty expected of them in their day-to-day practice. With that in mind, it is refreshing to report that not all practice is viewed through such a negative lens.
In a recent decision of the BC Supreme Court,1 a former client blamed their listing agent for not obtaining them substantially more money from the sale of their house. They had listed their house with several REALTORS® with no success. The sellers chose their last REALTOR®, whom they eventually sued, in large part because she was the listing agent for a property across the street.
The sellers listed their property for $10,000 less than the property across the street. They received an offer close to $100,000 below the listing price. They alleged that the listing agent "pressured" them into accepting the low offer. The listing agent deposed that she had told the sellers it was up to them whether to accept, reject or counter the offer. Although not known to the sellers at the time, the house across the street sold for almost an identical amount. After accepting the offer, the sellers learned of another house in the neighborhood that had sold for almost $225,000 more than theirs. The sale of this neighboring property was entered into a week before the sellers accepted their offer, although that sale did not become unconditional until some two weeks after the sellers had accepted their offer. The sellers deposed that they would not have accepted the offer they received had the listing agent advised them of the other sale.
The sellers claimed that the listing agent was negligent in not providing them with a comparative market analysis that would have disclosed all the properties in the neighborhood, negligent in not discovering the pending sale of the property that sold for close to $225,000 more than theirs, and in a conflict of interest by concurrently listing two competing properties across the street from each other.
The Court dismissed all of the sellers' claims. While agreeing that the listing agent owed a duty of care to the sellers, the Court found that the sellers had not provided any evidence as to what that standard of care might be and, as such, had not established that the listing agent had breached the standard of care.
On the issue of the alleged conflict of interest, the Court concluded that there was no authority for the proposition that acting as the listing agent for two properties in the same neighborhood gave rise to a conflict of interest; if it did, the sellers had expressly waived such conflict, as they were fully aware of the other listing at the time they engaged the listing agent.
The sellers' main complaint was that they were not made aware of the pending sale, which turned out to be close to $225,000 more than the offer they accepted. However, the Court concluded that those details would not have been available to the listing agent until after that pending sale had become unconditional, which was after the time the sellers were considering their offer. In dismissing the claim, the Court concluded that "the defendants did not have a legal duty to obtain the best possible price for the property. Rather, a REALTOR® has an obligation to act in accordance with the applicable standard of care for giving advice on price for a property."
It is not unusual for sellers or buyers, with 20/20 hindsight, to conclude they should not have entered into a particular transaction and to claim that their REALTOR® "pressured them into entering into the agreement" or conversely that their REALTOR® "should never have allowed them to enter into the agreement." It is the REALTOR®'s function to make sure that their client has all pertinent and available information before them, so that the client may make an informed decision. It is not the REALTOR®'s function to make that decision for them.
BC Home Sales Turn Higher, Inventories at 20-Year Low
Vancouver, BC – May 15, 2017. TheBritish Columbia Real Estate Association (BCREA) that a total of 9,865 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in April, down 23.9 per cent from the same period last year. Total sales dollar volume was $7.19 billion, down 25.4 per cent from April 2016. The average MLS® residential price in the province was $728,955, a 2 per cent decrease from the same period last year.
“BC home sales are on an upward trend this spring, led by a sharp increase in consumer demand in the Lower Mainland," said Cameron Muir, BCREA Chief Economist. The seasonally adjusted annual rate (SAAR) of home sales was over 106,000 units in April, significantly above the five-year SAAR for April of 89,000 units.
The supply of homes for sale declined 17 per cent from April 2016. On a seasonally adjusted basis, active residential listings have declined 50 per cent since 2012 and are now at their lowest level in over 20 years. The imbalance between supply and demand is continuing to drive home prices higher in most regions, further eroding affordability.
Year-to-date, BC residential sales dollar volume was down 31.8 per cent to $21.3 billion, when compared with the same period in 2016. Residential unit sales declined 25.0 per cent to 30,757 units, while the average MLS® residential price was down 9.2 per cent to $692,220.
The First Time Home Buyers' Program reduces or eliminates the amount of property transfer tax you pay when you purchase your first home. If you qualify for the program, you may be eligible for either a full or partial exemption from the tax.
If one or more of the purchasers don’t qualify, only the percentage of interest that the first time home buyer(s) have in the property is eligible.
For example, if you qualify and purchase a property with a fair market value of $400,000 with a person who doesn’t qualify you would still qualify. If you owned a 60% interest in the property, 60% of the tax amount would be eligible for the exemption.
have lived in B.C. for 12 consecutive months immediately before the date you register the property or filed at least 2 income tax returns as a B.C. resident in the last 6 years
have never owned an interest in a principal residence anywhere in the world at any time
have never received a first time home buyers' exemption or refund
If you don’t qualify because you are not a Canadian citizen or permanent resident, but you become one within 12 months of when the property is registered, you may apply for a refund of the property transfer tax. To apply for a property transfer tax refund in this case, call (250) 387-0604. However, if you’re a foreign national, foreign corporation or taxable trustee, you can’t be refunded any additional property transfer tax (PDF) you may have paid.
Apply
To apply for the First Time Home Buyers' Program you need to complete the First Time Home Buyers' Property Transfer Tax Return when you or your legal professional register the property transfer.
After you have applied you must meet additional requirements during the first year you own the property to keep the tax exemption.
Penalty for False Declaration
All applications are reviewed. You will be charged a penalty equal to double the tax if you falsely declare that:
you have never owned an interest in a principal residence anywhere in the world at any time, or
you have never received a first time home buyers' exemption or refund
First Year of Ownership
At the end of the first year you own the property you will receive a letter. The letter is to conditionally confirm that you meet the occupancy and property value requirements after you:
continued to occupy the property as your principal residence for the remainder of the first year
You may keep part of the exemption if you moved out before the end of the first year.
If the owner passed away, or the property is transferred because of a separation agreement or a court order under the Family Law Act before the end of the first year, you still qualify to keep the tax exemption.
Built New Home
If you registered a vacant lot and built your own home, to keep the tax exemption:
the fair market value of the land when you registered the property plus the cost to build your home must be:
$500,000 or less if registered on or before February 21, 2017, or
$525,000 or less if registered on or after February 22, 2017
you must have built and moved into your home within 1 year of the date the property was registered
you must have continued to occupy the property as your principal residence for the remainder of the first year
You may keep part of the exemption if you moved out before the end of the first year.
If the owner passed away, or the property is transferred because of a separation agreement or a court order under the Family Law Act before the end of the first year, you still qualify to keep the tax exemption.
Bank of Canada Interest Rate Decision - December 7, 2016
The Bank of Canada announced this morning that it is holding the target for its overnight rate at 0.5 per cent. In the press release accompanying the interest rate decision, the Bank noted that uncertainty in the global economy is undiminished in recent months while Canadian economic growth is evolving as anticipated. On inflation, the Bank cited that although CPI and core inflation have picked up, both measures remain below the Bank's 2 per cent target.
With long-term interest rates jolted upward by the US election, the Bank of Canada is likely content to keep its overnight rate on hold at 0.5 per cent over the next year. That said, the stark unpredictability of the incoming Trump administration on everything from trade to taxes to financial markets means that risk in the economy is tilted to the downside. Therefore, there remains the potential for a rate-cut by the Bank of Canada should economic conditions and the outlook for inflation deteriorate.
Canadian media found an increasing number of listed international students, most of whom are Chinese students, buy expensive houses in Vancouver through mortgage. The media caution about the possible loophole for such international investment.
Vancouver Sun reported on Wednesday that the buyers of a total of 9 real estates in Vancouver's Point Grey, worth a total of 57 million Canadian dollars (CAD), were listed as international students, and all of them were thought to be Chinese students. Bank mortgages of up to 40 million CAD were used to purchase the properties.
According to Vancouver Sun, Chinese student Xuan Kai Huang bought a house there for just over 7 million CAD (5.5 million USD) and re-sold it for over 8 million in May this year. Huang earned over 1 million CAD (900 thousand USD) through the re-sale.
An investigation by The Globe and Mail said that non-Canadian citizens do not need to show income verification certificates if they can pay a set down payment when applying for mortgages in Vancouver.
This year real estate prices rose rapidly with a surge of international investment. Vancouver Sun urged the Canadian government for more control over banks providing mortgages to non-Canadian citizens.
In response to rising real estate price, the provincial government of British Colombia levied a 15% property transfer tax to non-Canadian citizens buying Vancouver residential houses or condos.
According to Cooper, the Bank of Canada's limited ability to offset a negative shock has the bank signalling the need for fiscal measures and risk-limiting regulations to lessen the gap between household debt and assets.
The Bank of Canada has said the high debt level posed a vulnerability for the financial system, and that the amount of debt compared to disposable income was becoming alarming. As as result, the ratio of household debt to disposable income (excluding pension entitlements) rose to 167.6%, up from 165.2% in Q1.
"The upward trend in household debt, which started as far back as we have data - 1990 - is showing no signs of ending anytime soon", said Benjamin Reitzes, economist at BMO Capital Markets, citing rising house prices in Canada's biggest cities, led by Toronto, and weak gains in hourly wages.
Sales of existing Canadian homes fell in August, the fourth straight monthly decline, with sales in Vancouver tumbling almost 19 percent as a tax on foreign buyers doused activity in Canada's most expensive market, the Canadian Real Estate Association said in a report that also predicted prices will start to fall in 2017.
Victoria Property Sales Continue Record Breaking Pace
September 1 2016, Victoria, BC
A total of 883 properties sold in the Victoria Real Estate Board region this August, an increase of 19.2 per cent compared to the 741 properties sold in August last year.
"August is a record breaker in more than one way. For the sixth consecutive month, we have a sales record with more sales than any other month of August on record," says Mike Nugent, 2016 President of the Board. "We also have the lowest number of listings available for sale in an August than we've seen in the last twenty years. That lack of inventory will continue to put pressure on pricing. Sales would be even higher were there more inventory available for buyers to purchase. Regardless of the low inventory, it's safe to say that by mid-September we will have surpassed the number of sales for all of 2015, with four months remaining in the year."
Inventory levels remain lower than last year, with 2,094 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of August 2016, 43.2 per cent fewer than the 3,688 active listings at the end of August 2015.
"As we saw last month, the expected seasonal slowdown continues as we move towards the autumn," adds Nugent. "August tends to be the slower summer month, though the year-over-year sales numbers are very strong. This shows continued consumer confidence in the Victoria real estate market. It is early to determine a trend, but we don't see any early indications that the foreign investment Property Transfer Tax implemented in Metro Vancouver has impacted sales to any extent in Victoria at this time."
The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in August, 2015 was $603,200. The benchmark value for the same home in August 2016 has increased by 23.8 per cent to $746,900
Call me at 250.884.3980 to discuss any real estate matter and chat about the stats or the recommendations in the IAG report.
Vancouver, BC – May 13, 2016. TheBritish Columbia Real Estate Association (BCREA) reports that a record 12,969 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in April, up 30.3 per cent from the same month last year. Home sales last month beat March’s record of 12,560 units. Total sales dollar volume was $9.64 billion in April, up 52.7 per cent compared to the previous year. The average MLS® residential price in the province was up 17.2 per cent year-over-year, to $743,640.
“Housing demand is exceptionally strong across the southern regions of the province,” said Cameron Muir, BCREA Chief Economist. “Consumers appear to be particularly active in the Vancouver Island, the Fraser Valley and the Thompson/Okanagan regions.“
“Strong employment growth is helping underpin consumer confidence,” added Muir. The BC economy employed more than 78,000 additional workers during the first four months of the year, an increase of 3.5 per cent compared to the same period last year.
The year-to-date, BC residential sales dollar volume increased 64.3 per cent to $31.2 billion, when compared with the same period in 2015. Residential unit sales climbed by 36.2 per cent to 28,028 units, while the average MLS® residential price was up 20.6 per cent to $761,860.
Too often this column focuses on a REALTOR®'s error or mistake resulting in the REALTOR®'s censure by either a court or the Real Estate Council of British Columbia. Such columns, while concentrating on the negative aspects of practice, are essential in providing REALTORS® with an understanding of the appropriate standard of care and duty expected of them in their day-to-day practice. With that in mind, it is refreshing to report that not all practice is viewed through such a negative lens.
